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| Net Access: Getting the Consumer Society Connected | |
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Communication
Workers Union Conference Contents That’s me … David Edmonds, Director General of Oftel, the UK’s telecommunications regulator. I’d like to thank you for inviting me here to speak to you about our thoughts on getting the consumer society connected. This is something we are very much involved in, and I hope I can share with you some of our current activities in this area. But first I’d like to explain what Oftel is about:
Slide 2 Oftel’s role is to enhance quality, choice and value for money for consumers, The primary means by which Oftel seeks to achieve this is by competition. Through competition the consumer is most likely to get a choice of innovative products and services at keen prices and of good quality. This applies as much to Internet access as to other areas of Oftel’s work.
Slide 3 But before we go too far, let’s look at the wider picture. When people connect to the Internet they do so, to do things, such as send emails or browse the web. They do more than just ‘connect to the Internet’. Although I shall be talking about the Access Network [shown as the fluffy cloud on the left] we need to bear in mind that people buy services, not technologies. If the services aren’t there, or are not what people want, then the access network is irrelevant, as no one will use it anyway. Conversely high demand for certain services can encourage further investment in access networks. The provision of access networks and the provision of services could be seen as a chicken and egg situation. Oftel is acting to ensure the access part of the equation is not the stumbling block.
Slide 4 The telephone network is still the primary route to the Internet, and its usefulness should not be underestimated. 95% of households have the potential to access the Internet via this route. Oftel’s regulatory framework has enabled the Subscription-Free ISP access model to flourish, saving many subscribers around a tenner a month in subscription fees compared to this time last year. At the weekend it’s possible to browse the Internet for two hours for the same price as a pint of beer ! One area of misconception I must address is that of unmetered or free access to the Internet. Oftel is not opposed these kind of services, indeed as I stated earlier our goal is to achieve the best value for customers in terms of quality, choice and value for money. If BT were to offer such a product we would look at it, like we do all BT’s products, to ensure that it were not anti-competitive or breaking any of its licence conditions.
Slide 5 The telephone isn’t the only way to connect to the Internet however. These are exciting times, with a whole load of different technologies starting to become commercial reality. [A selection of which are shown on the slide.] Higher bandwidth services such as high speed Internet, video on demand and other e-commerce services are of fundamental importance to the development of the UK’s electronic economy and are likely to play a vital role in the future of communications. Oftel is committed to ensuring that UK consumers and businesses are well placed to make use of new Information Age technologies that will deliver these services.
Slide 6 The ubiquity of BT’s copper loop means DSL may have the most potential in the short term to deliver higher bandwidth to the mass market. Oftel is considering whether it needs to act to ensure consumer gets choice, quality and value for money. In our consultation last year, we set out 2 main types of regulatory action:
The two options may not be mutually exclusive…. There are some difficult judgements that need to be made. We are still analysing these issues expect to publish a second consultation document very shortly
Slide 7
If Britain is to be at the forefront in the Information Age it is vital that our children are properly equipped with the appropriate skills. In 1996, my predecessor, Don Cruickshank, set up a schools task force to consider the issue of the cost of connecting schools to the Internet. The telecommunications industry responded positively to this challenge. Special tariffs for Internet access are available to all schools in the United Kingdom. Indeed, schools have an array of choice with many telecommunications companies and service providers, not just BT, offering special packages for schools. I am pleased that the telecommunications industry, through its own initiatives, has made a valuable contribution towards the National Grid for Learning.
As we all know, one good turn usually leads to being asked to do another. The success of this work prompted an invitation from the Government for Oftel to work with the industry to secure discounts for a further specified range of public institutions. These institutions are FE colleges, public libraries, Learning Centres and Citizens Advice Bureaux. I have now met with the Chief Executive Officers of the major telecoms companies in the UK to ask them to consider what they can do to assist these institutions. In our discussions, I have emphasised the importance of ensuring that there are public points of access to the Internet. We all want the learning society to be inclusive. To avoid the spectre of a divide between those with access to the Internet and those without, public libraries and other similar institutions will play a key role in ensuring that even people without a computer or modem in their home can be part of this learning society. I hope to be in a position to report to Ministers in the near future about the outcome of these discussions. [Some of you in this audience may well be asking ‘what about us’. I believe that the work that Oftel is doing, only some of which I have the time to explain in this talk will help secure cheaper access to the Internet for everyone. You will also I am sure appreciate, that in order to ensure that the UK continues to be at the forefront of the information technology revolution, the telecoms industry has to make a return on its investment. Prices will continue to fall but companies cannot offer special deals to everyone.]
Slide 8 …and there is always "universal service". Universal service is a collection of policy tools that we use to ensure that nobody misses out on the social and economic opportunities offered by the telephone. Through obligations upon BT, we ensure that everyone in the country has access to a telephone at an affordable rate. And we have introduced special schemes to try to provide a basic level of service even if you can’t afford the normal tariffs. The obvious question is……. "Can we use the same techniques to secure access to some of the faster broadband services we have been talking about?" ….. and if we can, should we? There are many reasons why introducing a universal access to broadband for the majority is very different from helping a minority who can’t afford basic telephony, so I’m not making any promises. But we’re going to be looking at the issues shortly and I hope there will be a good debate.
Slide 9 So … Oftel believes that the Internet is an opportunity for all, and it’s about people using services not technology. As we saw in my earlier slide, access is only part of a much wider and extremely exciting picture. We all need to play our part. Oftel is determined to play its part, which I hope I have demonstrated by describing the various activities we are involved in. These are exciting times, and I look forward to a lively discussion!
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